Mobile Payments
What Are Mobile Payments? Definition and How They Work
Definition
Mobile payments refers to payment transactions initiated or completed via a mobile device, encompassing in-app payments, mobile web payments, contactless NFC payments at point of sale, and QR code-based payment flows.
How it works
Mobile payments is a category term covering multiple distinct payment mechanisms that share the characteristic of involving a mobile device as the initiation point. The main subcategories are: in-app payments where the consumer completes a transaction within a merchant's native mobile application; mobile web payments where the consumer completes a transaction on a website accessed via a mobile browser; contactless NFC payments at physical point of sale using Apple Pay or Google Pay; and QR code payments.
Each mechanism has distinct technical requirements. In-app payments require integration of a mobile SDK for both iOS and Android platforms and must comply with app store payment policies. Mobile web payments use standard web-based payment integrations but must be optimised for mobile UX including wallet triggers that allow one-tap checkout. NFC contactless at POS uses the same tokenisation infrastructure as physical card contactless but is initiated by the mobile device's secure element.
Conversion optimisation for mobile is a distinct discipline. Mobile screens have less real estate for checkout forms, keyboard entry of card numbers increases abandonment, and consumer expectations for checkout speed are higher on mobile. Merchants with significant mobile traffic must prioritise wallet enablement and checkout UX to minimise mobile abandonment.
Why it matters
In most e-commerce verticals over 60-70% of sessions are mobile; payment optimisation for mobile directly impacts the majority of transaction volume. Card number entry on mobile keyboards generates materially higher abandonment than desktop; each additional form field reduces mobile conversion. Enabling Apple Pay and Google Pay removes the card entry step entirely, the single biggest mobile conversion improvement available. IOS in-app purchases for digital goods must use Apple's in-app purchase system which takes a commission of up to 30%; merchants of digital goods must factor this into pricing and margin. Mobile wallet contactless payments now exceed physical card contactless in many markets; POS terminal software must support mobile wallet NFC for omnichannel merchants.
With PXP
PXP's payment platform supports full mobile payment optimisation including in-app SDK integration for iOS and Android, Apple Pay and Google Pay web and app integration, and QR code payment capabilities for relevant markets. PXP's checkout is designed for mobile-first UX to minimise abandonment.
Frequently asked questions
What is the difference between in-app and mobile web payments?
In-app payments occur within a native mobile application downloaded from the App Store or Google Play. They use a mobile payment SDK and are subject to app store policies, Apple requires use of its in-app purchase API for digital goods sold within iOS apps. Mobile web payments occur on a merchant's website accessed through a mobile browser. The key distinction for merchants is the app store commission (up to 30% for digital goods on iOS) which does not apply to mobile web purchases.
How do merchants enable Apple Pay and Google Pay on mobile web?
Apple Pay on mobile web is enabled via the Apple Pay JS API which checks if the device and browser support Apple Pay, renders an Apple Pay button, and handles the payment sheet. Merchants need to verify their domain with Apple and integrate the API. Google Pay on mobile web uses the Google Pay API. Both require the merchant's payment provider to support pass-through wallet processing.
What are the App Store payment policy implications for merchants?
Apple requires that digital goods and services sold within iOS apps use Apple's in-app purchase (IAP) system which charges Apple a commission of 15-30%. Physical goods and services fulfilled outside the app are exempt and can use any payment method. The distinction between digital and physical goods is important: a streaming subscription must use IAP; a food delivery order payment does not.
How does mobile NFC contactless work technically?
Mobile NFC contactless payments use the device's NFC chip and a secure element to store and transmit a tokenized card credential. When the consumer holds their device near an NFC-enabled terminal the terminal reads the token via the EMV contactless protocol, the same protocol used by physical cards. The token is passed to the acquirer which routes the transaction to the card scheme. The process is functionally identical to physical card contactless from the acquirer's perspective.
Revolutionize your business with PXP
Take complete control of your commerce and payments with one platform.
Get Started